Islamic Banking in India- Problems and opportunaties

Saudi Arabia, Malaysia, Kuwait, the United States, Britain, Japan, Thailand, Morocco, Tunisia are few countries where interest-free Islamic banking system is rapidly becoming popular. Even with a long list of those countries where Islamic banking soon appear in practice. India could be one of those countries with the launch of Islamic Index for Islamic banking in capital Delhi.

With almost 60 million of capital already 10 private banks, according to the Islamic banking system are functioning in India. A surprising that many Muslim countries the Life Insurance Corporation has offered interest-free insurance plans as of yet in India this is not in a position to present a plan. The release of one of the country Islamic Capital Index Adwaijr Company Limited Indo Adwaijrs Istvind Capital – Arab Economic Cooperation Forum and the Institute has launched with objective studies. The Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) in 664 listed companies Islamic Index is a measure of moral fact. The companies on this scale with a certificate of integrity has been found.

The companies included in this index is their common Islamic market capitalization is Rs 4,146,880. Sector 9 boards and 68 it all – including Industries. If these companies classified according to CAP, then the Islamic index 52 High Cap, Mid Cap 236, 205 Small Cap and Micro Cap companies include 151. According to the release of Index Capital Istvind retail and institutional investors use the Islamic index will be able to invest.

The question is, what is all this Islamic index? Before that we need to understand Islamic Index Islamic banking system of understanding.

Islam 1400 years old is a financial system which has three major aspects. The first and major aspect, which those activities take yourself away from sin or evil in Islam is considered full. For example, gamble, drink alcohol and eating pork. The second aspect, the third aspect of interest must not, stay away from the uncertain activities. Islamic Index of companies actually live on these three aspects is the stock index. This investment could help such investors that Islamic finance based on moral or companies want to invest their capital. Islamic banking system in India currently does not exist at government level. But launched Islamic Index Islamic banking system in India in fact could become a tool of the beginning.

The question is, what are rapidly developing country like India needs an Islamic banking system?

If the global performance of Islamic banking system should look – yes, it is. Economists and financial experts estimate that Islamic banking is that it rapidly gained popularity in view of the world economy in the coming decade, Islamic and non Islamic is divided into two camps. In fact, if Islamic banking or financial system would have been an extension Sirp Muslim countries in the world that doubts remain about being overshadowed. But the truth is that non-Muslims as Muslims by the Islamic financial system also has been getting massive support. Islamic banks in Malaysia to invest around 20 per cent non-Muslims and 40 per cent in Kuwait at the same Malaysian bank branch to deposit money and 60 per cent of the loans are non-Muslim. It can be guessed that the Islamic banking system as non-Muslims, between Muslims in the world is becoming popular rapidly.

Muslim countries, especially the Gulf countries were expensive crude oil grew too large huge income investments in these financial and banking institutions.

Overall, nearly 200 world banks and financial institutions that currently exist around 1000 billion U.S. dollars which is engaged and the capital is estimated that by 2010 it could be doubled. Since large parts of the world financial system in the Islamic trend in the public and Islamic banks and financial institutions increased significantly – is vital capital inflows. So almost all major world banks have either started their Islamic banking branches or have announced to launch. The American City Bank, Standard Chartered Bank, Sdibisi Bank, HSBC and the UK including major banks. All these banks have opened their own Windows-based Islamic banking. So now the world’s other large banks have also turned this way. London, Tokyo and Hong Kong’s many large financial institutions with Islamic banking system to ignore the fast has begun. Citibank Islamic banking in Asia for Citigroup then duly ` ‘name for it has remained a separate department.

While Islamic banking system in India is concerned about Sugbugaht, the Emergency, when the center was built when the Janata government in India Jmayte Islami Hind introduction of interest-free Islamic banking system was suggested. But the then finance minister, HM Patel, interest-free banking system by telling it impractical rejected. But in 2004 when the center became the Prime Minister Dr. Manmohan Singh UPA Government of the Islamic banking system constituted a committee to explore possibilities. The Reserve Bank of India committee headed Operation Manager Anand Sinha were built. The Committee country – many banking and financial matters of foreign experts and the representatives of such institutions were included. । The committee later reported in their study said that the country will have to amend existing laws for Islamic banking which is currently not possible. Therefore be expected to cancel its conclusion, he expressed.

But Indo – Arab Cooperation Forum and Chairman of the Islamic decisive role in getting the index continued Dr. Alam says approved by the UK banking system to implement a duly Now your basic banking (system) has a constitutional amendment the problem then why India should be good. Interestingly, in Britain in 2004, there’s financial regulatory body to allow the establishment of Islamic Bank of Britain was. Overall, the thing to say that the way Islamic banking system expanded rapidly in the world is watching him very soon in India, the Islamic banking system also may appear at the government level. Maybe because in the last days, a committee headed by Cabinet Secretary has also been formed in which former officers, finance, law and Revenue Department Secretary also are included.

Islamic banking system in the world so fast after all, why is it popular?

Its biggest attraction is reconfigured to its interest-free loans. Islamic banking system is considered that one should be given credit for its economic upliftment, not to earn it. But the current debt policy is based on borrowers who earn from. Bank loans for that if he gives it Trp by how you maintain your interest will not be able. But taking advantage of interest rather than the Islamic banking system is part and partnership based on her income does establish the existence of its own. Islam is a rule that those who feel that food in the year – after drinking needs, which saves money, the money remaining in the half cent tax to give as zakat, which says. Islamic banking system through the zakat its pan – keeps on flowering. If in fact the Islamic banking system in India should be applied and the millions of needy people are interest-free loan to acquire the interest in the cycle are forced to commit suicide every day, it will be a divine miracle. However, the poor currently can only hope that how soon they will get loans from a system that will not help them.